While major Big Box retailers have struggled to keep pace with consumer-driven demands for instant gratification, Sears Holdings has come up with new innovations to anticipate and serve shoppers with a new one-day ground delivery service supported by a dynamic DC network.

When an industry is changing rapidly, companies must adapt in order to survive. In this whitepaper, a global publisher was seeking a partner that could mitigate risk and build a platform flexible enough for their shifting customer expectations. The solution enabled the company to rewrite their operations game plan and transform their supply chain.

Join our panel of leading economic and transportation analysts as they share their exclusive insight on where rates are headed and the issues that will be driving those rate increases over the next 12 months.

As has been the case for several months, heavy spot market activity remains prevalent in the freight transportation market, with July turning in another strong performance, according to recent data published by Portland, Oregon-based freight marketplace platform and information provider DAT.

For the month of July, DAT said that the van load-to-truck ratio came in at an average of 3.2 percent, which was down significantly from June––by 26 percent––and was up 23 percent compared to July 2013.

DAT defines load-to-truck ratios as the number of loads posted for every truck posted on DAT load boards, with the ratios serving as a “sensitive, real-time indicator of the balance between spot market demand and capacity.”

While June was a record-setting month, July was not as strong but still impressive. Spot market activity has been well above levels in recent years for various reasons, explained DAT, including: disruptive Q1 weather; an improving economy; seasonal fluctuations of freight and capacity; and shippers relying more on 3PLs to secure freight and meet the needs caused by the growing volume of exception freight.

The average reefer load-to-truck ratio dropped 21 percent to 9.1 from a June seasonal high of 11.5, said DAT, with the annual load-to-truck ratio up 15 percent annually in July. And flatbed load volume in July fell 11 percent compared to June and capacity rose 14 percent, which saw the load-to-truck ratio fall 22 percent. Even with this decline, though, DAT noted that on an annual basis July saw 52 percent more flatbed loads and 19 percent fewer trucks posted, leading to an 88 percent gain annually in the flatbed load-to-truck ratio.

A general consensus for the ongoing strength in the spot market––for both volume and rates––among industry stakeholders is tied directly to the capacity shortage, with larger shippers running routing guides awarding lanes to carriers and brokers when they suddenly cannot get capacity and then needing to turn to brokers in the spot market.

Mike Regan, Chief Relationship Officer at TranzAct Technologies, said in a recent interview that current trends on the spot market are strong, as the DAT data indicates

But he noted the underlying reasons as to why that is the case are not always prescient.

“Some people point to a stronger economy, but it might have more to do with the discipline of the carriers in terms of how they run their equipment and maintain strong pricing,” he said. “More carriers can make more money running fewer trucks, a carrier CEO recently told me. And call-to-haul factors for each piece of equipment are running especially strong and allowing them to maintain discipline on the pricing side. I don’t know if the gains we are seeing are as much a product of demand as they are of pricing.”

When asked if the spot market volume gains and rate momentum can carry over into the second half of the year, Regan noted that remains to be seen.

“The fact that the spot market is this strong at this time of the year tells me things could be slower in the September and October timeframe,” Regan said. “There is also the question if we are seeing a shortening in the cycle of back-to-school shipments and that type of stuff. And many larger carriers are still talking about idling capacity because they cannot find enough drivers. If GDP heads up over 2 percent, people may have a tougher time finding trucks than they already are.”

About the Author

Jeff BermanGroup News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).

Subscribe to Logistics Management magazine

Subscribe today. It's FREE!

Get timely insider information that you can use to better manage yourentire logistics operation.

Recent Entries

When an industry is changing rapidly, companies must adapt in order to survive. In this whitepaper, a global publisher was seeking a partner that could mitigate risk and build a platform flexible enough for their shifting customer expectations. The solution enabled the company to rewrite their operations game plan and transform their supply chain.

While it is already reaping myriad benefits from ORION (On-Road Integrated Optimization and Navigation), a proprietary routing platform for its drivers rolled out in late 2013, transportation and logistics bellwether UPS announced big plans for the technology this week.